Questions About 38 Studios’ Solvency?
John Depetro alluded to it earlier today. But it looks like WJAR/NBC10/Turn to 10’s Bill Rappleye got what can only be viewed as a confirming quote from Governor Chafee.
State officials have been meeting with the video game company owned by former Boston Red Sox pitcher Curt Schilling, Gov. Lincoln Chafee told NBC 10 on Monday.
“We’re always working to keep Rhode Island companies solvent, and that’s what we’re doing with 38 Studios,” Chafee said.
Potentially at stake, of course, is $75 million tax dollars, as WPRI’s Ted Nesi and Steve Nielsen point out.
The R.I. Economic Development Corporation gave 38 Studios a $75 million taxpayer-backed loan in 2010 with the strong backing of EDC Executive Director Keith Stokes and then-Governor Carcieri.
Let the record show that Governor Chafee was strongly opposed to this arrangement from the beginning.
It is to be hoped that these reports are overblown and 38 Studios will successfully navigate some purported rough seas. Nevertheless, it is hard not to hear and read these reports and come to one inexorable conclusion: however small these loan guarantees are compared to the total of economic activity in the state, this is not a realistic approach to economic development. Taxpayer capital cannot begin to substitute for a good (or even just neutral!) business climate. This, in turn, can only be created at the General Assembly by legislators who are willing, in the words of small business owner Roland Benjamin, to
look at the small business community as a growth engine in the economy, not a tax revenue source
I would only quibble by omitting the adjective “small”. Big and small; we need them all.